Last week the first three firms were given approval to operate as Alternative Business Structures (ABSs) and duly licensed.

For those unfamiliar with the territory, an ABS is a firm where a non-lawyer is a manager of the firm, or has an ownership-type interest in the firm. A firm may also be an ABS where another body is a manager of the firm, or has an ownership-type interest in the firm and at least 10 per cent of that body is controlled by non-lawyers. The Legal Services Act is designed to liberalise the £23bn UK legal market by allowing companies to provide legal services, and will permit firms to float on the stock market or seek external capital. Last year justice secretary Kenneth Clarke expressed the hope that the advent of alternative business structures would have as dramatic an impact on legal services as the so-called ‘Big Bang’ of 1986 had on the financial sector.

An ABS is not limited in the services that it can offer to the public. The point of the legislation is to demystify the law, making the purchase of legal services as simple for consumers as buying a tin of beans, and thus it became known as “Tesco Law.” But Co-operative Legal Services is one of the first firms licensed as an ABS, with Tescos so far nowhere in sight. The Co-op’s ambitions to expand its legal offering have been far from a secret, including the launch of a fixed-fee family law service later this year, handling legal aid work, and offering face-to-face legal advice through the Co-op’s bank network, which, if its bid for Lloyds branches is successful, would give it around 1,000 locations.
To mark the occasion justice minister Jonathan Djanogly visited Co-operative Legal Services Headquarters in Bristol to talk to staff and customers about the reforms.

He said: “This is a huge milestone for UK legal services and the future of Alternative Business Structures. ABSs introduce more competition in the market place, delivering competitive pricing, higher standards of product and more choice for the consumer.
Our UK legal services are unrivalled around the world and these changes will allow them to reach new heights, as solicitors’ firms develop new markets, seek external investment and join up with other businesses to offer different products to consumers and provide opportunities for growth.”

In response Eddie Ryan, Managing Director of Co-operative Legal Services, said: “We are committed to playing a leading role in this new era by offering straightforward value-for-money expert legal services, backed by an ethos of social responsibility and a level of protection that can be provided by a diverse, multi-billion pound organisation.”

Another new license holder is Lawbridge Solicitors Ltd, based in Sidcup, Kent. This is an existing solo practice run by Michael Pope, handling employment work, litigation and commercial/corporate legal services. His wife Alison, currently the practice manager, will become a director of the firm with a significant shareholding. The third new license holder is John Welch and Stammers, a long-standing generalist law firm in Witney, Oxfordshire. Bernadette Summers, who has been practice manager for the past 12 years, will be appointed as a non-lawyer managing partner.

The Solicitors Regulation Authority has to date received around 60 stage 2 applications to become ABSs, and a further 120 stage 1 expressions of interest.

This post was written by:

Mike Gribbin is a retired Civil Servant with wide experience, including the drafting and implementation of Parliamentary legislation and regulations. He is the editor of “Criminal Offences Handbook”, a uniquely comprehensive guide to more than one thousand ways to fall foul of UK criminal law. He is Editor of the Upper Case Legal Journal and has been writing blog posts for the past eight years.